To the editor:
Indiana needs a fair tax system to replace three unfair taxes — property tax, sales tax and flat-rate income tax, all rooted in the economy of the 19th century. A fair tax system would have everybody in the pool with a fair share.
I believe a fair tax system would be based on the amount of money that is received in a year, from every source, for every reason, without loopholes for deductions and manipulations. A gross receipts tax on every person and organization in the state would fund the state and local governments without any other taxes needed. The only other taxes would be fuel and excise taxes that attempt to discourage people from involvement in recreational drugs, alcohol, tobacco and gambling.
A gross-receipts tax of 2.25% on individuals, 3.25% on sole-proprietors and 4.25% on all other professionals and businesses would cover all the expenses of state, county and city governments. The savings resulting from a decrease in state and local bureaucracy would be a bonus if it is allowed to occur. Business in particular should welcome such an approach since it would not require time and talent being diverted today trying to maximize deductions and exemptions.
A fair tax system could lead to a fair health care system and an employment system that invests fairly in workers displaced by technology or relocation. Tax reform needs to be based on the 21st century and genuine simplicity, not more bandaids on already broken and unfair systems.
Donald A. Smith
Franklin
